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 WASHINGTON, Sept. 28 /PRNewswire/ -- Amtrak President Thomas M. Downs today announced a reorganization, management cuts and a series of steps that the railroad will take to position Amtrak as a leaner, more competitive, customer-driven transportation service business. On Saturday, October 1, Amtrak's Northeast Corridor business unit will begin operation. The NEC is one of three business units to be established as part of the company's strategic plan being developed for Fiscal Year 1995.
 The preliminary Strategic Plan and budget were presented today to Amtrak's Board of Directors. After considering the company's projected budget deficit of $193 million for FY 1995, the Board directed management to take immediate steps to eliminate the deficit and to prepare a final FY 1995 budget and strategic plan with specific actions to present to the Board in December. Among the actions to be considered for the final plan are overhead cost reductions, better equipment utilization, revenue enhancements, service adjustments, and a reduction in fuel consumption, and utility and material costs.
 As part of the announced reorganization, Amtrak is decentralizing its Washington headquarters-based organization into three business units, placing both management and operations at the train platforms. By the end of the year, two other units will be established on the west coast and in Chicago.
 Downs told the Amtrak Board of Directors, "The launching of the business units represents a new chapter in the 24-year history of Amtrak. Our business orientation and our restructuring will allow us to concentrate on enhancing customer service, increasing ridership, identifying growth opportunities, cutting costs and becoming aggressively competitive with the airlines."
 The business units are designed to provide more direct customer service and on-the-spot problem solving. To respond quickly, each unit will reduce layers of management and have fewer managers. A smaller corporate organization will support the business units with company-wide services like training and equipment repair. Downs announced that management staff would be reduced by more than 600 positions by the end of 1994. Currently, Amtrak has nearly 2,100 managers with a total work force of about 25,000 employees.
 The reorganization will provide Amtrak with a foundation to take on the challenges of the coming year and future years. During the last three years, passenger-related revenues have declined by $76 million from $963.4 million in FY 1991 to a projected $887.4 million in FY 1994. If the railroad continues to operate in its current state, it is expected that there will be a shortfall of $193 million between expenses and revenues during the 1995 budget year.
 Equipment Modernization
 Besides reorganizing, Amtrak is modernizing its fleet, which will lead to more reliable service and operating savings. During 1995, Amtrak will put into service 10 new locomotives, 36 Viewliner sleeper cars and 68 Superliner sleeper, diner, lounge and coach cars.
 Two weeks ago, the railroad also requested proposals for 26 high speed trains, which will be the first manufactured in the United States. The high speed trains will be put in Metroliner service in 1997 on the Northeast Corridor, allowing Amtrak to decrease travel time from New York to Boston to under three hours.
 Amtrak's new business orientation also calls for the railroad to become market- or customer-driven and to scrutinize all of the railroad's operations, services and expenses from top to bottom. The railroad will adopt standards to publicly measure service performance, identify expenses and cost of service, reduce overhead and develop new growth opportunities.
 Downs said, "Over the next year, we will focus on the quality of our service -- everything ranging from on-time performance, working public address systems, the comfort of our stations, cleanliness of toilets, to the courtesy extended to each of our customers. As directed by the Board, we will also work hard to cut costs and increase revenues to give our customers good service at an affordable price. All of this work will be done in partnership with all of our external customers, ranging from those who purchase tickets to the important decisionmakers on Capitol Hill."
 Downs added, "Amtrak faces many tough challenges and decisions in the coming year. But I am confident that Amtrak's dedicated employees working in a business-oriented organization will give the railroad the edge that it needs to compete in a market that demands customer responsiveness, low costs, growth and value. Together, we will build a strong national passenger railroad for America's future."
 -0- 9/28/94
 /CONTACT: Sue Martin of Amtrak, 202-906-3860/

CO: Amtrak ST: District of Columbia IN: TRN SU: PER

IH-DC -- DC056 -- 8986 09/28/94 18:17 EDT
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Publication:PR Newswire
Date:Sep 28, 1994

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